• All Share : 49290.56
    UP 4.25%
    Top 40 : 3477.06
    UP 4.58%
    Financial 15 : 15494.28
    UP 4.65%
    Industrial 25 : 61779.42
    UP 4.80%

  • ZAR/USD : 11.5578
    DOWN -0.63%
    ZAR/GBP : 18.1106
    DOWN -0.06%
    ZAR/EUR : 14.2002
    DOWN -1.10%
    ZAR/JPY : 0.0973
    DOWN -0.73%
    ZAR/AUD : 9.4411
    DOWN -0.16%

  • Gold : 1198.1850
    UP 0.65%
    Platinum : 1200.2000
    UP 0.69%
    Silver : 15.8950
    UP 0.92%
    Palladium : 793.0000
    UP 2.32%
    Brent Crude Oil : 59.790
    UP 0.88%

  • All data is delayed by 15 min. Data supplied by I-Net Bridge
    Hover cursor over this ticker to pause.

Fri Dec 19 01:02:59 CAT 2014

Zimbabwe central bank cautions on foreign bank ownership

Reuters | 31 January, 2013 18:55
Reserve Bank Of Zimbabwe Governer Gideon Gono. File photo.
Image by: Africa Edition

Zimbabwe's central bank chief on Thursday cautioned the government against a drive forcing foreign banks to hand over majority stakes to locals, saying this could damage confidence in the sector battling through a fragile economic recovery.

Gideon Gono also said the current dollar crunch and high interest rates, which averaged 22 percent in 2012, were a result of political risk and urged leaders to tone down rhetoric that could scare away foreign investment.

Zimbabwe was on a "path to destruction" with a huge import bill of $7.5 billion last year against exports of $3.9 billion, Gono added.

"The financial sector is a different animal altogether, a one-size-fits-all approach does not work for the sector," Gono said in a monetary policy presentation.

He added there was a need to "restore confidence, trust and stability in the sector."

Foreign firms, already cautious about doing business in the resource-rich but destitute state, were increasingly skittish about entrenched President Robert Mugabe's calls forcing them to turn over majority stakes to locals.

Mining firms have faced the most pressure but banks have increasingly become targets.

Standard Chartered Bank Plc, Barclays Bank Plc , South Africa's Standard Bank and Nebank all have operations in Zimbabwe.

The southern African country is set to hold a referendum on a new constitution by April and general elections later this year. It has approached foreign donors to help finance an election it says it cannot afford.

The country's economy has stabilised since the formation in 2009 of a unity government between Mugabe and rival, Prime Minister Morgan Tsvangirai, but growth is slowing as the country struggles to attract badly needed foreign cash.

SHARE YOUR OPINION

If you have an opinion you would like to share on this article, please send us an e-mail to the Times LIVE iLIVE team. In the mean time, click here to view the Times LIVE iLIVE section.